Ever feel like the job market’s gone quiet? You’re not imagining it. London’s hiring scene just logged its eighth consecutive month of decline, and November’s numbers paint a pretty stark picture of what happens when economic uncertainty meets a shrinking pool of vacancies.
According to fresh data from KPMG and the Recruitment and Employment Confederation (REC), permanent hiring in London didn’t just slow down last month, it accelerated downward. We’re talking one of the sharpest drops in permanent vacancies since the pandemic. Ouch.
Here’s what’s actually happening on the ground, why it matters, and what it means if you’re either hiring or hunting for work right now.
Why London’s Permanent Hiring Market Is Tanking
The numbers don’t lie. Permanent hires fell faster in November than they have in months, driven by a toxic combo of economic jitters and vanishing job openings.
London recruiters are seeing something they haven’t witnessed in a while: a massive surge in available candidates. November marked the fastest growth in candidate availability in three months, fuelled by redundancies and expired contracts. Translation? More people are suddenly looking for work, and there are fewer roles to go around.
That’s a candidate-rich environment for employers, sure. But for job seekers, it’s a brutal squeeze. Competition’s ramping up just as opportunities are drying up.
Temporary Roles Aren’t Picking Up the Slack
You’d think temporary and contract work might cushion the blow, right? Not quite.
While London recruiters did see a slight uptick in billings from temporary placements, demand for short-term roles continued its nosedive. November marked the 15th straight month of falling temporary vacancies—and the fastest rate of decline since February.
Temporary staff supply also jumped, hitting its highest level since August. More people are pivoting to flexible work simply because permanent opportunities have evaporated. But naturally, that flood of candidates is making temp roles just as competitive.
Anna Purchas, senior partner at KPMG UK, tried to find a silver lining: “November’s figures show employers are still being careful about permanent hiring, but it’s encouraging to see temporary demand picking up as employers look to short-term contracts to help them to meet staffing needs.”
She added that this suggests “some positive movement in the London jobs market.” Emphasis on some.
Salary Inflation Is Back—But Only Just
Here’s the one bit of decent news: starting salaries for permanent roles actually increased in November, posting their strongest growth in five months.
Temporary workers also saw modest pay bumps, especially those with in-demand skills. But let’s be frank, the increase was described as “fractional.” So don’t expect a windfall just yet.
Neil Carberry, REC chief executive, said the uptick in pay offers “signs of the market stabilising in London and the UK.” But he didn’t mince words about the government’s role: they need to “do more to get the economy firing.”
Carberry pointed to pre-Budget jitters knocking temporary recruitment back in November, despite a stronger October. His verdict on the government’s growth agenda? “Their report card at the end of 2025 reads ‘Must try harder.'”
Brutal, but fair.
What This Means for Employers and Job Seekers
If you’re hiring, you’ve got options. Candidate supply is high, competition for roles is fierce, and you can afford to be selective. But the data suggests employers are playing it safe, favouring short-term contracts over permanent commitments.
If you’re job hunting, brace yourself. Permanent vacancies are scarce, temporary roles are competitive, and redundancies are pushing more people into the market. The good news? Pay rates are creeping up, so if you’ve got the right skills, you might still have leverage.
The bottom line: London’s hiring market is stuck in cautious mode, and until economic confidence returns, don’t expect a dramatic turnaround anytime soon.
Key Takeaways
London’s job market is navigating choppy waters, but understanding the trends can help you plan your next move. Whether you’re hiring cautiously or hunting strategically, staying informed is half the battle. Keep an eye on economic signals and be ready to adapt as the market shifts.
FAQ
Q1: Why are permanent vacancies falling in London?
A: Economic uncertainty is making employers cautious about long-term hiring commitments. Combined with rising redundancies and expiring contracts, this has led to fewer permanent roles and increased candidate supply, creating a highly competitive market for job seekers.
Q2: Are temporary roles a better option right now?
A: Not necessarily. Whilst temporary billings rose slightly, demand for short-term roles has fallen for 15 consecutive months. More candidates are competing for fewer temp positions, making this segment just as challenging as permanent hiring.
Q3: Will salaries continue to rise in London?
A: Starting salaries for permanent roles saw their strongest growth in five months during November. However, pay increases for temporary workers remain modest. Future salary trends will likely depend on broader economic recovery and labour market stabilisation.
Q4: What’s driving the increase in candidate availability?
A: Redundancies and fewer contract renewals are pushing more people into the job market. November saw the fastest growth in candidate supply in three months, creating increased competition for the limited vacancies available across London.
Q5: What can employers do in this hiring climate?
A: Employers should consider short-term contracts to meet staffing needs whilst maintaining flexibility. With high candidate availability, it’s a good time to be selective, but offering competitive salaries for in-demand skills remains essential to attract top talent.
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Effective Date: 15th July 2025
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